Kidman Resources Ltd. said May 17 that it signed a binding agreement to supply lithium produced by Western Australia Lithium to Tesla Inc. for an initial three-year period. The terms of the deal were not disclosed.

Western Australia Lithium is a 50/50 joint venture between Kidman and Sociedad Quimica y Minera de Chile SA, or SQM. The companies chose a 76-hectare site at the Kwinana Strategic Industrial Area close to rail, road, port, electricity and natural gas and about 40 kilometers south of Perth's central business district.

The agreement covers less than 25% of Kidman's portion of the initial nameplate production for the first three years from the refinery.

The consortium is expected to deliver a definitive feasibility study by late this year for the refinery. Commissioning is targeted in 2021, with an annual nameplate capacity of about 44,000 tonnes per annum of lithium hydroxide, or 37,000 tonnes of lithium carbonate.